The latest tranche of “no deal” technical notices was released yesterday afternoon by the UK Government. Amongst them are several notices that highlight the Brexit issues faced by intellectual property right owners and, in some cases, confirm the Government’s approach to resolving them. The Government also released this news story today which comments on the guidance given in the technical notices and comments on the Government’s longer term aims for IP protection.

Key announcements, in the context of no deal, are:

Provision of a new right to replace unregistered Community design rights, to be known as “the supplementary unregistered design right“.

Existing EUTMs and Community registered designs will be replaced with new, equivalent rights in the UK at the end of the implementation/transition period, “with minimal administrative burden“.

If the UPC comes into force the UK will replace unitary patent rights with equivalent rights if the UK needs to withdraw from the new system, although the UK “will explore whether it is possible to remain within it“. The Government’s news story states that “The UK intends to stay in the Unified Patent Court and unitary patent system after we leave the EU.”

UK originating sui generis database rights will no longer be enforceable in the EEA; “UK owners may want to consider relying on other forms of protection (e.g. restrictive licensing agreements or copyright where applicable) for their databases“

The UK will set up its own GI scheme “which will be WTO TRIPS compliant“. The new rights “will broadly mirror the EU regime and be no more burdensome to producers“. Since the UK would no longer be required to recognise EU GI status, EU producers would be able to apply for UK GI status. Those wishing to protect UK GIs in the EU will need to submit applications on a third country basis.

The UK will continue to accept the exhaustion of IP rights in products put on the market in the EEA by, or with the consent of, the rights holder. However, the EU will likely not consider that goods placed on the UK market are exhausted in the EEA, and thus permission may need to be sought from the rights holder to transfer goods to the EEA that have legitimately been put on the market in the UK. The Government news story says that “The UK looks forward to exploring arrangements on IP cooperation that will provide mutual benefits to UK and EU rights holders and we are ready to discuss issues the EU wishes to raise in the negotiations on our future relationship, including exhaustion of IP rights”.

More detail on each of these is provided below. For those with an interest in Life Sciences please also see our blog post on the notices related to that sector that were released last month.

1. Patents The technical notice on patents identifies supplementary protection certificates (SPCs) as one of the few areas of UK patent law that comes from EU legislation, the others being the legal provisions on the patenting of biotechnological inventions (including exceptions from patenting, the scope of any protection, and a compulsory licensing regime between overlapping patents and plant variety rights); compulsory licensing for UK manufacture of a patented medicine for export to a country with a public health need; and the pharmaceutical product testing exception (that certain studies, trials and tests can be carried out using a patented pharmaceutical product without there being an infringement of the patent), as well as a broader exception to infringement is also set out in UK law which allows for other activities to be carried out to meet regulatory requirements for medicines, which exception relies on references to relevant EU law. The notice confirms that post-Brexit, the relevant EU legislation (or its domestic implementation) will be retained in UK law under the EU Withdrawal Act 2018 and states that the existing systems will therefore remain in place, operating independently from the EU regime, with all the current conditions and requirements and that any UK legislation supporting the existing systems will also continue to function as normal.

Thus (as is set out in the notice):

Any existing rights and licences in force in the UK will remain in force after March 2019. For UK, EU and third country businesses there will be no significant change to the legal requirements or the application processes. In particular, pending applications for patents and for supplementary protection certificates will continue to be assessed on the same basis, and new applications can continue to be filed. If legal proceedings involving these rights or licences are underway, they will continue unaffected.

The supplementary protection certificate regime in the UK will continue to operate as before for UK, EU and third country businesses.

The conditions for patenting biotechnological inventions will remain in place. UK, EU and third country businesses as patent holders, third parties and applicants can continue to make decisions on the basis of the current legislation. Patent examiners will continue to apply the same law when scrutinising patent applications in this area. Third parties who wish to challenge the validity of a patent will be able to do so on the same grounds as at present.

For compulsory licensing, UK, EU or third country businesses as holders of patents or plant variety rights which are valid in the UK will continue to be able to apply for a compulsory licence, where there is an overlap between the rights. UK, EU and third country businesses will continue to be able to obtain a compulsory licence for manufacturing a patented medicine to meet a specific health need in a developing country.

For pharmaceutical product testing, UK, EU or third country businesses can continue to rely on the exceptions from patent infringement provided for various studies, trials and tests carried out on a pharmaceutical product.

The Unified Patent Court (UPC) and unitary patent (UP) The notice also covers the UPC and UP, offering “two different scenarios” , one that the UPC does not come into force and the other that it does, in which latter circumstance “the UK will explore whether it would be possible to remain within” the UPC and UP system but if the UK needs to withdraw from the system it will ensure that UP protection in the UK is replaced by “continued protection in the UK”. The notice confirms that patent protection for the UK will need to be via national patent protection obtained via the UK IPO or the “non-EU European Patent Office” (otherwise known as the EPO). The notice concludes with the comment that “Businesses may wish to seek legal advice on how these arrangements could affect their business model or intellectual property rights.”

2. Trade marks and Designs These rights are dealt with under the same technical notice which concludes the following:

protection of existing registered EU trade marks or registered Community designs in the UK will be through a new, equivalent UK right which will be granted with minimal administrative burden

right holders will be notified that a new UK right has been granted. Any business, organisation or individual that may not want to receive a new comparable UK registered trade mark or design will be able to opt out

provision will be made regarding the status of legal disputes involving EU trade marks or registered Community designs which are ongoing before the UK courts and more information will be provided on this before the point at which the UK exits the EU

applicants with a pending application for an EU trade mark or a registered Community design at the point of exit will be able to refile, within nine months from the date of exit, under the same terms for a UK equivalent right, retaining the EU application date for priority purposes

applicants with pending applications for an EU trade mark or a registered Community design will not be notified and after exit will need to consider whether they refile with the Intellectual Property Office to obtain protection in the UK

UK applicants, like EU and third country applicants, will continue to be able to apply for protection in the EU through an EU trade mark or registered Community design as they do currently

the government will ensure that all unregistered Community designs which exist at the point that the UK leaves the EU will continue to be protected and enforceable in the UK for the remaining period of protection of the right. In addition to this, the UK will create a new unregistered design right in UK law which mirrors the characteristics of the unregistered Community design. This means that designs which are disclosed after the UK exits the EU will also be protected in the UK under the current terms of the unregistered Community design. This new right will be known as the supplementary unregistered design right

those UK unregistered design rights which exist at the point of exit will continue to be protected and the UK unregistered right will continue to exist for designs first disclosed in the UK. The UK will amend legislation to ensure that it functions effectively once the UK is no longer part of the EU system for designs.

The notice states that the Government “is working, including with the World Intellectual Property Organisation, to provide for continued protection in the UK from exit day onwards of registered trade marks and registered designs filed through the Madrid and Hague systems which designate the EU“.

3. Cross-border Copyright Sui generis database rights are included in this technical note on copyright, which also deals with portability of on-line content service, the country of origin principle for copyright clearance in satellite broadcasting, the orphan works copyright exception, collective management of copyright and cross-border transfer of accessible format copies of copyright works.

Sui generis database rights The notice concludes that there will be “no obligation for EEA states to provide database rights to UK nationals, residents, and businesses” and that “UK owners of UK database rights may find that their rights are unenforceable in the EEA“. The Government’s guidance is that “UK owners may want to consider relying on other forms of protection (e.g. restrictive licensing agreements or copyright where applicable) for their databases“.

Portability of online content services – The notice points out that the Portability Regulation (Regulation (EU) 2017/1128 will cease to apply to UK nationals when they travel to the EU, so online content service providers will not be required or able to offer cross-border access to UK consumers under the EU Regulation. As a consequence, “UK consumers may see restrictions to their online content services when they temporarily visit the EU“. No solution is offered, nor any suggestion that attempts may be made to negotiate one.

Country-of-origin principle for copyright clearance in satellite broadcasting – The notice states that UK-based satellite broadcasters that currently rely on the country-of-origin copyright clearance rule when broadcasting into the EEA may need to clear copyright in each member state to which they broadcast.

Orphan works copyright exception – The notice states that UK-based Cultural Heritage Institutions that make works available online in the EEA under the exception may be infringing copyright.

Collective management of copyright – ~The notice states that UK Collective Management Organisations will not be able to mandate EEA Collective Management Organisations to provide multi-territorial licensing of the online rights in their musical works.

Cross-border transfer of accessible format copies of copyright works – The notice states that the UK intends to ratify the Marrakesh Treaty after exit but ratification will not have taken place before 29 March 2019: “Between exit and the point of ratification, businesses, organisations or individuals transferring accessible format copies between the EU and UK may not be able to rely on the EU Regulation“.

4. Geographical Indications This technical notice comments that “there are currently 86 Geographical Indication (GI) protected UK product names, comprising 76 agricultural and food products, five wines and five spirit drinks which together make up a quarter of the value of UK food and drink exports” and as such these products provide a not insignificant contribution to the UK’s local economies. So it is perhaps not surprising that the notice confirms that the UK has elected to set up its own GI scheme “which will be WTO TRIPS compliant“. These new rights “will broadly mirror the EU regime and be no more burdensome to producers“. There will be a new logo for the UK GI different from the EU one. Since the UK would no longer be required to recognise EU GI status, EU producers would be able to apply for UK GI status. It is said that guidelines will be published in early 2019.

The notice anticipates that current EU GIs will continue to be protected under the EU’s GI scheme, but says that if this is not the case, UK producers that wish to maintain GI status in the EU would need to submit application to the European Commission as third country producers. The notice suggests that producers might consider protecting their products by applying for EU Collective Marks or EU Certification Marks. The notice also states that the UK Government is “working with its global trading partners to replicate EU free trade agreements and other sectoral agreements, including accommodating the protection of UK GIs in third countries. After March 2019, irrespective of the outcome of EU negotiations, the government anticipates that UK GIs currently named in and protected by EU free trade agreements and other sectoral agreements will continue to be protected“.

5. Exhaustion of IP rights This technical notice states that the UK will continue to accept the exhaustion of IP rights in products put on the market in the EEA by, or with the consent of, the rights holder. However, the EU will not consider that goods placed on the UK market are exhausted in the EEA, and thus permission may need to be sought from the rights holder to transfer goods to the EEA that have legitimately been put on the market in the UK.

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The articles published on this website, current at the dates of publication set out above, are for reference purposes only. They do not constitute legal advice and should not be relied upon as such. Specific legal advice about your specific circumstances should always be sought separately before taking any action.Herbert Smith Freehills LLP is authorised and regulated by the Solicitors Regulation Authority.